Sectoral analysis of the differences in profitability of Czech and German business ventures – an empirical benchmark study

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dc.contributor.authorBeyer, Dirk
dc.contributor.authorHinke, Jana
dc.contributor.otherEkonomická fakultacs
dc.date.accessioned2018-03-29
dc.date.available2018-03-29
dc.date.issued2018-03-29
dc.description.abstractProfitability measures are a lens through which business can be viewed and they form a common basis for investment decisions. Especially in areas close to national borders, these decisions could be linked to the question on which side of the border a venture should be located in order to realise country-specific comparative advantages that make the investment more profitable. Differences in profitability between countries are driven by manifold aspects, including specific cost or revenue structures, financing patterns and conditions, as well as taxation. The aim of this study is to identify the driving factors behind differences in profitability of Czech and German firms on the basis of a comparative analysis. In this article, a two-step variance analysis is conducted. The first step focuses on the operational differences in RoA between Czech and German ventures, which is based on deeper analyses of the asset turnover and the profit margin. In the second step, the differences in RoE are analysed, considering influences from national taxation, conditions and patterns of financing and operations of the ventures. A model-based cumulative variance analysis quantifies the impacts of these underlying drivers of profitability with a comparative focus. For this reason, the average measures of these drivers from 2002 to 2014 – the longest time series available for both countries are extracted from the BACH database, which provides harmonised accounting information. This paper confirms the hypothesis that specific drivers of profitability differ significantly between the two countries in certain business sectors and would cause substantial differences in profitability. Due to the overlapping nature of these individual effects, they compensate each other to a great extent. The results provide useful benchmarks that a company´s management can use to increase its profitability tackling specific comparative (dis-)advantages between the Czech Republic and Germany.en
dc.formattext
dc.format.extent17 strancs
dc.identifier.doi10.15240/tul/001/2018-1-009
dc.identifier.eissn2336-5604
dc.identifier.issn1212-3609
dc.identifier.urihttps://dspace.tul.cz/handle/15240/22791
dc.language.isoen
dc.publisherTechnická Univerzita v Libercics
dc.publisherTechnical university of Liberec, Czech Republicen
dc.publisher.abbreviationTUL
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dc.relation.ispartofEkonomie a Managementcs
dc.relation.ispartofEconomics and Managementen
dc.relation.isrefereedtrue
dc.rightsCC BY-NC
dc.subjectprofitabilityen
dc.subjectinternational benchmarkingen
dc.subjectvariance analysisen
dc.subjectbusiness sectorsen
dc.subject.classificationM21
dc.titleSectoral analysis of the differences in profitability of Czech and German business ventures – an empirical benchmark studyen
dc.typeArticleen
local.accessopen
local.citation.epage143
local.citation.spage127
local.facultyFaculty of Economics
local.filenameEM_1_2018_09
local.fulltextyes
local.relation.abbreviationE+Mcs
local.relation.abbreviationE&Men
local.relation.issue1
local.relation.volume21
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